The signals can take quite a lot of time if there are a lot of roads connected to the intersection. I was making a lot of diagonal roads coming out of an intersection of 2 roads and it turns out it takes forever for the signal. That is because it needs to give way in too many possibilities. Never do that.
Also another problem I'm having is with normal intersection (2 roads) but with very frequent services, such as "BRT" that I do with Trolley. Turns out that even 3 buses per hour in a 4 lane road with no heavy traffic, they pile up. The problem is that every car, every signal is something to make the bus slow down. And even removing most of the intersections, it doesn't help. And it happens exactly like that in real life. Frequent service doesn't work in non-exclusive areas (not only exclusive lanes) but right of way and physically blocking the traffic from this lane. Basically a true BRT needs an exclusive road with no intersections (or always green signals based on GPS - but that is not possible in the game) plus the use of the Trinary System.
Anyway, I never played with modified time speed, but I think the signals work all right. Also I notice if there is no traffic at all in one road the signal will never open for that. So they are smart as well, just not smart for public transport.
And it always depends on the map of course. Currently I'm playing Yersk, and I can easily avoid area with high traffic and still use a lot of buses. But each map is a different case. I don't think you can have a reliable bus service in Paris, since the traffic there is nightmare. Perhaps that is why they have 1 metro station every 500 m.